Our relationship with China

New Zealand and China have a relationship that started in the 1840’s. Since New Zealand and China established diplomatic relations in December 1972, the relationship has developed rapidly, particularly in recent years.

The first Chinese immigrant to New Zealand is thought to have been Appo Hocton, who arrived in Nelson in 1842. The first large scale influx of Chinese to New Zealand occurred in the 1860s, initially for gold-mining. Official contact began in 1912 with trade, missionary, immigration and other links but this came to a standstill in 1949, when the People’s Republic of China was formed. Today tens of thousands of Chinese students and hundreds of thousands of Chinese tourists come to New Zealand each year, and visits between political leaders and heads of state take place regularly

China is New Zealand’s largest trading partner in goods and second largest overall including trade in services. The New Zealand–China Free Trade Agreement (FTA) signed in 2008 was China's first FTA with a developed country. China is one of the world’s fastest-growing economies and its vast population and growing middle class represent huge potential.

The five firsts

In 1997, New Zealand became the first country to agree to China’s accession to the WTO by concluding the bilateral negotiations component of that process.

New Zealand was the first country to recognise China as a market economy in 2004.

New Zealand was the first developed country to commence FTA negotiations with China. In November 2004, New Zealand and China launched FTA negotiations.

In April 2008, New Zealand became the first country to successfully conclude Free Trade Agreement negotiations with China.

In November 2016, New Zealand and China jointly announced the launch of negotiations to upgrade our bilateral FTA, a first for a developed country with China.

But New Zealand’s innovative relationship with China extends beyond its trading relationship, and into areas including aid cooperation and mutual recognition of each other’s systems. For example:

In 2013, New Zealand was the first country to undertake a tripartite development project with China, providing better water infrastructure to the Cook Islands.

In 2014, New Zealand was the first country to sign inter-governmental agreements with China to jointly produce both television and film productions.

In 2015, New Zealand was the first developed country to become a prospective founding member of the Asian Infrastructure Investment Bank (AIIB); and

In 2016, New Zealand was the first country to achieve mutual recognition with China on organic food certification.

Education and tourism

Education and tourism links have been growing strongly over the past decade. From early beginnings when both countries offered an exchange programme for three students each, China is now our largest source of foreign students and there were over 40,000 Chinese student enrolments in New Zealand in 2017.

Tourism between our two countries has also increased rapidly. Our first diplomats had to walk into China after flying to Hong Kong because China had no international air links. In high season, there are now over 80 direct flights between New Zealand and China (including Hong Kong) every week. China is the second, and most rapidly-growing, source of tourists to New Zealand (behind Australia), with over 400,000 visitors in 2016.

Trade

2018 statistics

Total trade in goods

$27.2 billion

Exports to China

$15.3 billion

Top exports: dairy, wood products, meat

Imports from China

$11.9 billion

Top imports: machinery, clothing & apparel

GDP

US$11 trillion (2016)

GDP per capita

US$8,827

(NZ GDP per capita is US$38,518)

GDP growth

6.7% (2016)

We have a strong and growing trade relationship with China. The NZ-China FTA was initially projected to increase our exports by between $225-$350 million each year. However this was rapidly exceeded, with exports increasing by $1 billion in the first year, and growth continuing.

New Zealand–China FTA

The New Zealand-China FTA was New Zealand’s biggest trade deal since the Closer Economic Relations agreement with Australia in the 1980s. It cements the trading relationship between our two countries, and frees up business for exporters, the service sector and investors. By 2016, New Zealand had duty free access on over 97% of China’s tariff lines, with core dairy products transitioning to full free trade in 2024 for milk powders, and two years earlier for butter, cheese and liquid milk and cream.

China’s Cybersecurity Law came into effect on 1 June. It aims to protect China's national security – the definition of which extends to maintaining territorial integrity, social and economic stability, and the public order.

It regulates how organisations and businesses should protect digital information:

including whether and under what circumstances it can be transferred out of mainland China

This is an evolving area of law that applies to companies differently, depending on their nature and the area theyoperate in. We’ll keep you informed as changes develop – in the meantime, we recommend that you:

consider the updates to Chinese cybersecurity law and how they will relate to your business

Trade in services

China is New Zealand’s largest education market, with over 40,000 Chinese students in New Zealand in 2017. Chinese visitor arrivals numbered more than 436,000 in 2017. China is New Zealand’s second-largest source of visitors after Australia. While education and tourism are the biggest service exports, New Zealand also increasingly exports ‘knowledge economy’ services such as design, information technology, film and TV, and food safety. New Zealand’s overall services exports to China increased to NZ$2.9 billion in 2017.

Investment

Investment between New Zealand and China including Hong Kong has been growing strongly in recent years, reaching NZ$ 6.2 billion in 2016. Chinese investment exists across a diverse range of sectors. Some recent high profile Chinese investments in New Zealand include into Envirowaste and Waste Management, Fisher and Paykel Appliances, Synlait, and PGG Wrightson. Large New Zealand investments in China include Fonterra and Fletcher Building's Formica Group.

Free trade agreements with China

Aid

New Zealand no longer has an official aid programme in China — this stopped in 2005. However, we still contribute approximately $300,000 a year through the New Zealand Embassy in Beijing, which funds small-scale projects that reduce poverty and contribute to a more secure, equitable and prosperous China.

Climate change

The New Zealand-China Climate Change Action Plan 2017 enables Chinese and New Zealand carbon markets experts to share technical information and expertise on carbon markets and emission trading schemes, as well as agricultural greenhouse gas mitigation.

The two countries also agree to cooperate more in international climate change negotiations.

The action plan was announced in March 2017 during Chinese Premier Li Keqiang’s visit to New Zealand. It gives practical effect to the broad approach set out in the New Zealand-China Climate Change Cooperation Arrangement signed by the two countries’ leaders in 2014.

China Capable public sector project

The New Zealand Government has recently set up the 'China Capable public sector programme'. This programme aims to attract, develop, retain and deploy China expertise across New Zealand's public sector agencies.

China is New Zealand’s second largest trading partner, and our largest goods trading partner, and is different from our traditional trading partners in many respects, including culture and language. Therefore the China Capable public sector project aims to develop China expertise across our public sector agencies. This is an all-of-government project that is currently being led by MFAT.

China-New Zealand initiatives, announced March 2017

Chinese Premier Li Keqiang visited New Zealand from March 26-28. A number of initiatives between China and New Zealand were signed during his visit. The full list is on the Beehive website (external link). These initiatives included nine arrangements signed on behalf of a number of government agencies. These include:

Memorandum of Arrangement on Strengthening Cooperation on the Belt and Road Initiative between the Government of New Zealand and the Government of The People’s Republic Of China. Download the memorandum [PDF, 495 KB]. We are in discussions with China on the implementation of our Belt and Road Memorandum of Arrangement. This includes developing a work plan based on information sharing, which targets specific issues, and focuses on areas clearly in New Zealand’s national interest.

Arrangement between the Ministry of Foreign Affairs and Trade and the Ministry of Commerce of The People’s Republic Of China on Cooperation on Electronic Commerce. Download the arrangement [PDF, 431 KB].

Arrangement between the Ministry of Foreign Affairs and Trade of New Zealand and the Ministry of Commerce of the People’s Republic of China on Strengthening Exchanges on International Development Cooperation. Download the document [PDF, 466 KB].

May 2016: Politburo Member for Publicity, Liu Qibao met Prime Minister John Key, Culture and Heritage Minister Maggie Barry and launched a China Film Week at Te Papa, co-hosted by China and the New Zealand Film Commission